Are Larger Countries Really More Corrupt? [book]

Omar Azfar
1999 Policy Research Working Papers  
Several authors claim to provide evidence that governmental corruption is less severe in small than in large countries. We demonstrate that this relationship is an artifact of sample selection. Most available corruption indicators provide ratings only for those countries in which multinational investors have the greatest interest: these tend to include almost all large nations, but among small nations only those that are well-governed. We find that the relationship between corruption and
more » ... size disappears, using either a new corruption indicator with substantially increased country coverage, or an alternative corruption indicator that covers all World Bank borrowers without regard to country size. We also show that the relationship between corruption and trade intensity -a variable strongly related to population -disappears using samples less subject to selection bias.
doi:10.1596/1813-9450-2470 fatcat:3sblf6u7dfcddcoll7tnwybrvq